WALLINGFORD — The Town Council approved a resolution Tuesday allowing the mayor to apply for a $500,000 state grant that would be used to reconstruct the rear Simpson Court parking area.

Councilors voted 7-1 to approve the resolution, with Craig Fishbein, a Republican, voting against it. Republican Town Councilor Christine Mansfield abstained from voting due to her affiliation with Holy Trinity Church, which borders the parking lot. The church would be involved in a proposed public-private agreement to reconstruct the lot, partially because of a retaining wall owned by the church which requires maintenance.

The town is seeking grant money from the Main Street Investment Fund. Administered by the state Office of Policy and Management, the grant offers up to $500,000 for downtown infrastructure improvements. The town requested funding through the grant in 2012 but the request was denied. A second round of funding was announced last month. Town Engineer John Thompson said the town is making “substantially the same application” to the state as it did previously.

If funding is available through the state, the town is prepared to enter into a 30-year lease agreement with five property owners bordering the parking lot. The lot is near the intersection of Center Street and North Main Street. Each owner has agreed to contribute $10,000 to the project, according to Republican Mayor William W. Dickinson Jr. The town is still waiting to see if Wells Fargo will be part of the agreement, he said. This differs from previous agreements when property owners were responsible for $20,000, half of which would have been reimbursed after the project was finished. Dickinson said he didn’t want to bother with the reimbursement.

“This would provide improvements to one interim spot as people go up and down Center Street,” said Dickinson. Public Works is scheduled to reconstruct the parking lot adjacent to the old railroad station this summer, he added.

As part of the proposed project, the town would install cobblestone in the alleyways between the North Main Street properties, as well as decorative lighting in the lot. Dickinson said parking would be free, but if that didn’t work out, a four-hour limit would be put into place.

Thompson said the project would cost just under $500,000. The town has a year-to-year lease agreement with Simpson Court business owners. The agreement offers public parking in the lot behind those buildings in exchange for plowing and other basic maintenance. A plan to renovate the parking lot backed by Dickinson, a Republican, and others was defeated in a 2011 referendum. That plan would have been paid for with local funds.

Several residents spoke out against the project Tuesday night. Jason Zandri, a former town councilor and mayoral candidate, said if the town proceeded with the project, he would work to force another referendum.

“There’s no way this won’t go to referendum again,” he said. “Whether it would pass or not is another story, but I believe the sentiment is the same; if you want to see the public support this better, get more of a financial contribution from the property owners.”

Fishbein, along with former Democratic town councilors Jason Zandri and Nick Economopoulos, co-authored a letter to the state in 2012 asking that the town’s grant application not be approved.

While Fishbein said a reconstructed lot would be nice, “the financial agreement doesn’t make sense at all.”

With current construction estimates, property owners would only pay two percent of the project total each. But Dickinson said he had no issue with the amount each individual property owner was contributing. Dickinson said he was more concerned about the grand total. Fishbein said the way costs were distributed to property owners doesn’t make sense because some parcels are larger than others.

Mary Lee Pimentel, who owns 36 though 40 North Main Street, said it’s not fair to place the burden on property owners since the town has never lived up to its agreement that it would pay each property owner $1 per year for parking rights.

“I’ve never gotten a dollar from the town,” she said. “We have no opportunity to receive revenue for leasing out our property.”

While property owners have provided parking to the town, they haven’t received any financial gain while they continue to pay property taxes, Pimentel said. If the lot is reconstructed, taxes will only go up, she added.

Thompson said the $10,000 contribution from property owners was negotiated. If the town asked for any more, there’s no guarantee they would comply, he said, and if one property owner drops out, the whole project is in jeopardy. Thompson suggested this might be the last time the town will be able to get sufficient grant money from the state to complete the project with rising construction costs. Dickinson said the town will continue to pursue the lot even if it is not successful in winning a grant from the state this year.

A large number of residents spoke out against the project Tuesday night. Many were opposed to private-public partnerships, while others felt the town should concentrate on other parking lots in the downtown area located to the rear of Center Street businesses.

“I’m baffled at the fact we continue to revisit this project,” Debbie Gross aid. “I would like to see something done with the lower downtown area.”

“Why are we considering this lot time-after-time if we have other areas lagging behind in the downtown,” Larry Morgenstein said.

Town Councilor John Sullivan, a Democrat, stressed that this project isn’t the same as the one voted down through referendum because the town is seeking state money instead of local tax dollars for funding. While both use tax money, “I would think Wallingford citizens would want their representatives to seek and get state money when it’s available,” Sullivan said.

In other action, the council approved a tax-fixing agreement with hotel developer Bob Winston, who proposes to build a 139-room Hilton Garden Inn at 1181 Barnes Road. The council previously gave the agreement tentative approval in March. The agreement will decrease Winston’s property tax payments by about $400,000 over the first seven years after the hotel is finished.